CTRN - Citi Trends falls 6% after warning on slow start to Q1

2023-03-21 07:53:18 ET

Citi Trends ( NASDAQ: CTRN ) reported a 13.1% year-over-year drop in total sales for Q4 . Comparable sales were down 14.4% for the quarter. CEO David Mauken said the quarter presented a highly challenging economic environment, especially for low income families.

SG&A expenses were 33.7% of sales compared to 33.0% of sales a year ago and 32.1% seen in the pre-pandemic level in Q4 of 2019.

Operating income was $7.5M vs. $12.6M a year ago. Adjusted EBITDA was $12.3M vs. $17.8M a year ago,

Looking ahead, Citi Trends ( CTRN ) warned that customers are expected to remain under pressure through the first half of 2023, impacted by ongoing inflationary factors, in addition to the reduction in SNAP benefits and lower tax refunds. Q1 was said to be off to a slow start.

Citi Trends outlook: "We remain cautiously optimistic that our customers will experience relief from economic pressures over the course of the year and we are playing offense to drive comp store productivity, our highest priority. We are sharpening our focus on trend development and refining assortments to fuel incremental sales. We are planning the second half to deliver meaningfully improved results thanks to controlling what we can control and leveraging our strong balance sheet and healthy inventory position."

Despite a narrow Q4 earnings beat, shares of Citi Trends ( CTRN ) fell 5.88% in early trading to $21.94 vs. the 52-week trading range of $15.48 to $37.84.

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